Exhibit 10.1


 


FLEXSTEEL
INDUSTRIES, INC.


RESTRICTED
STOCK UNIT NOTIFICATION OF AWARD 


FOR
________________


 


This
Restricted Stock Unit Award (“Award”) is effective as of the ___ day of _____ (the “Grant Date”) between
FLEXSTEEL INDUSTRIES, INC., a Minnesota Corporation (the “Company”) and _____________, an employee of the Company
(“Employee”). The Company desires to provide the Employee with a long-term incentive to continue the Employee’s
services to the Company, and to increase his participation in the success of the Company. This Award is granted under the terms
of the Company’s 2013 Omnibus Stock Plan (the “Plan”). (See Attachment A, the “Plan”.)


 


Therefore,
the Award is as follows:


 


		1.	Issuance
                                         of Restricted Stock Units. Subject to the terms and conditions set forth below in
                                         this Notification of Award, the Company grants to the Employee _______ RSUs equal to
                                         ($_________) _____________ Dollars with the number of Restricted Stock Units (“RSUs”)
                                         to be awarded based upon the average of the previous 10 trading days closing stock price
                                         to the Grant Date. The number of RSUs shall vest as enumerated in Section 2, and shall
                                         be paid as provided in Section 6.



 


		2.	Vesting.
                                         Except as otherwise provided in this Section, the Employee’s rights in and to the
                                         RSUs shall become vested upon the earliest of the following dates or events to occur:



		a.	On
                                         _______ shall vest, if the Employee is employed and in good standing with the Company
                                         on that date;



		b.	On
                                         the date of the Employee’s death while employed with the Company;



		c.	On
                                         the date the Employee is determined to be disabled under the Company’s long-term
                                         disability plan for entitlement to benefits thereunder;



		d.	On
                                         the date of a Change in Control of the Company (as defined in Section 3 below), if the
                                         Employee is employed and in good standing with the Company on that date; or



 


If
the employment of the Employee shall terminate for any reason prior to the earliest date or event provided in subsection a. through
f. above, all RSUs shall be forfeited to the Company, without payment to the Employee therefor. Notwithstanding any earlier vesting
as provided above, the Employee shall have no rights in or to the RSUs or payment under this Notification of Award if the Employee
is terminated for Cause (as defined in Section 4 below).


 


		3.	Change
                                         in Control. Change in Control means any of the following:



		a.	Any
                                         individual, entity or group becomes a “Beneficial Owner” (as defined in Rule
                                         13d-3 of the Exchange Act), directly or indirectly, of at least twenty percent (20%)
                                         but less than fifty percent (50%) of the voting stock of the Company in a transaction
                                         that is not previously approved by the Board of Directors of the Company;



		b.	Any
                                         individual, entity or group becomes a Beneficial Owner, directly or indirectly, of at
                                         least fifty percent (50%) of the voting stock of the Company;



		c.	The
                                         persons who were directors of the Company immediately prior to any contested election
                                         or series of contested elections, tender offer, exchange offer, merger, consolidation,
                                         other business combination, or any combination of the foregoing cease to constitute a
                                         majority of the members of the Board of Directors of the Company immediately following
                                         such occurrence;



 



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		d.	Any
                                         merger, consolidation, reorganization or other business combination where the individuals
                                         or entities who constituted the Company’s shareholders immediately prior to the
                                         combination will not immediately after the combination own at least fifty percent (50%)
                                         of the voting securities of the business resulting from the combination;



		e.	The
                                         sale, lease, exchange, or other transfer of all or substantially all the assets of the
                                         Company to any individual, entity or group not affiliated with the Company;



		f.	The
                                         liquidation or dissolution of the Company; or



		g.	The
                                         occurrence of any other event by which the Company no longer operates as an independent
                                         public company.



 


		4.	Cause.
                                         “Cause” means:



		a.	The
                                         willful and continued failure of the Employee to perform substantially the Employee’s
                                         duties as established from time to time by the Company’s management (other than
                                         any such failure resulting from a disability), after a written demand for substantial
                                         performance is delivered to the Employee by the Company’s management that specifically
                                         identifies the manner in which the management believes that the Employee has not substantially
                                         performed the Employee’s duties; or



		b.	The
                                         willful engaging by the Employee in illegal conduct or misconduct as described in the
                                         Flexsteel Industries, Inc. Employee Handbook, as amended from time to time, or gross
                                         misconduct that is materially and demonstrably injurious to the Company as determined
                                         by the Company to constitute conduct that warrants forfeiture pursuant to the Plan and
                                         this Notification of Award.



 


For
purposes of this definition, no act, or failure to act, on the part of the Employee shall be considered “willful”
unless it is done, or omitted to be done, by the Employee in bad faith or without reasonable belief that the Employee’s
action or omission was in the best interests of the Company. Any act, failure to act, based on (i) authority given pursuant to
resolution duly adopted by the Board, or (ii) the advice of counsel for the Company shall be conclusively presumed to be done
or omitted to be done, by the Employee in good faith and in the best interests of the Company.


 


		5.	Dividend
                                         Equivalents on RSUs. During the period prior to vesting (as defined in Section 2
                                         above), Dividend Equivalents will be credited quarterly as cash, accumulating until vesting
                                         and payout at the same time as the underlying RSU award. Any credited Dividend Equivalents
                                         shall thereafter be subject to the terms of this Notification of Award to the same extent
                                         as the RSUs giving rise to the Dividend Equivalents. Dividend Equivalents shall otherwise
                                         be considered a part of the award of Restricted Stock Units.



 


		6.	Payment
                                         of RSUs. Except as provided in the next sentence, the Company shall pay to the Employee
                                         the value as determined in this Section 6 of the RSUs credited to the Employee under
                                         this Award within fifteen (15) days after the vesting date (as defined in Section 2 above).
                                         The amount to be paid shall be the number of whole RSUs credited to the Employee under
                                         this Agreement converted to shares and Dividend Equivalents shall be paid in cash.



 


		7.	Changes
                                         in Capital Structure of the Company. The number of RSUs held by the Employee for
                                         which payment pursuant to Section 6 has not been made shall be adjusted equitably by
                                         the Company in the event of (i) a subdivision or combination of the shares of capital
                                         stock of the Company, (ii) a dividend payable in shares of capital stock of the Company
                                         (iii) a reclassification of any shares of capital stock of the Company or (iv) any other
                                         change in capital structure of the Company. Such adjustment shall be made as if each
                                         RSU represented an issued and outstanding share of Common Stock of the Company as of
                                         the date of such adjustment. Any additional RSUs credited to the Employee as a result
                                         of any of the foregoing events shall continue to be subject to the terms of this Notification
                                         of Award to the same extent as the RSUs giving rise to the right to receive such additional
                                         RSUs.



 



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		8.	Withholding.
                                         The Company has the right to deduct and withhold any taxes due as a result of this Award.
                                         The Company may, in its discretion, elect to withhold cash from other compensation payable
                                         to the Employee by the Company or withhold shares otherwise payable to you under this
                                         Notification of Award to satisfy applicable federal, state, and local withholding tax
                                         requirements with respect to the RSUs and Dividend Equivalents. The Employee agrees to
                                         pay to the Company, when due, any amount necessary to satisfy applicable federal, state,
                                         and local withholding tax requirements with respect to the RSUs and Dividend Equivalents.
                                         The Company will process payment of the amount determined under Section 6 through the
                                         Employee’s payroll along with applicable withholding taxes.



 


		9.	Forfeiture
                                         and Clawback. Forfeiture and Clawback provisions as provided for in the Plan apply
                                         to this Award. See the Plan document and Attachment B “Competitive Activity”
                                         and “Improper Use of Confidential Information” definitions to this Notification
                                         of Award for more details.



 


		10.	Employment
                                         of Employee. Nothing in this Notification of Award shall be construed as constituting
                                         a commitment, guaranty, agreement or understanding of any kind or nature that the Company
                                         shall continue to employ the Employee, and this Notification of Award shall not affect
                                         in any way the right of the Company or its subsidiaries to terminate the employment of
                                         the Employee at any time for any reason. The Company shall have the right to reduce or
                                         recoup amounts due under the Notification of Award, but only to the extent such reduction
                                         or recoupment is specifically required by any federal or Minnesota law or regulation
                                         with respect to amounts due under this Notification of Award.



 


		11.	General
                                         Creditor. The RSUs represent an unfunded promise to pay cash or cash equivalents
                                         in the future and the Employee shall not have any rights other than as a general creditor
                                         of the Company with respect to the payment of the value of the RSUs as provided in this
                                         Agreement. The Employee shall not sell, transfer, pledge, assign or otherwise encumber
                                         any of the RSUs, whether voluntarily, involuntarily or by operation of law. Any purported
                                         transfer, pledge or encumbrance of such RSUs shall be void and unenforceable against
                                         the Company, and no purported transferee shall acquire any right or interest with respect
                                         to the RSUs or the payment therefor as a result.



 


		12.	Rights
                                         of Stockholder. The Employee shall not have any rights of a stockholder of the Company
                                         with respect to the RSUs, including the right to vote.



 


		13.	Governing
                                         Law. This Agreement shall be construed and enforced in accordance with the laws of
                                         the State of Minnesota, without regard to the principles of rules of any jurisdiction
                                         with respect to conflict of laws.



 


		14.	Incorporation
                                         of Plan. Except to the extent specifically provided in this Notification of Award,
                                         this grant shall be subject to and governed by the terms and conditions of the Plan,
                                         which shall be incorporated as though fully set forth herein. Capitalized terms not otherwise
                                         defined in this Notification of Award shall have the meaning set forth in the Plan.



 



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		15.	Entire
                                         Notification of Award; Modification. This Notification of Award sets forth all of
                                         the promises, conditions, understandings, warranties and representations between the
                                         parties with respect to the RSUs, and there are no promises, agreements, conditions,
                                         understandings, warranties or representations, oral or written, express or implied, between
                                         the parties with respect to the RSUs other than as set forth in this Notification of
                                         Award, the Plan and referenced and related attachments to the Plan. This Notification
                                         of Award is, and is intended by the parties to be, an integration of any and all prior
                                         agreements or understandings, oral or written, with respect to the RSUs. Except as provided
                                         in Section 14, any change in, or modification of, this Agreement shall be valid only
                                         if in writing and signed by the parties to this Agreement.



 


		16.	Notices.
                                         Any and all notices provided for in this Notification of Award shall be addressed: (i)
                                         if to the Company, to the principal executive office of the Company to the attention
                                         of Secretary, and (ii) if to the Employee, to the address of the Employee as reflected
                                         in the records of the Company.



 


		17.	Invalid
                                         or Unenforceable Provisions. The invalidity or unenforceability of any particular
                                         provisions of this Notification of Award shall not affect the other provisions, and this
                                         Notification of Award shall be construed in all respects as if that invalid or unenforceable
                                         provision were omitted.



 


		18.	Acknowledgment.
                                         Your receipt of this Notification of Award, the Plan documents and related attachments
                                         as referenced in the Plan, including the Guidelines for Stock Ownership, constitutes
                                         your agreement to be bound by the terms and conditions of this Notification of Award
                                         and the Plan.



 


IN
WITNESS WHEREOF, the Company and the Employee have executed this Notification of Award to be effective as of the Grant Date.


 


 


 


	Accepted and Confirmed:	 	FLEXSTEEL INDUSTRIES, INC.
	 	 	 
	 	 	 	By	 
	Participant	Date	 		Date
	 	 	 	 	 
	 	 	 	 	 



 



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